Inflation - August 05, 2022 Windham Independent
Inflation - a hidden tax
The Department of Labor reported that prices are 9.1 percent higher in June than a year before - a 41-year high. June’s 1.3 percent increase was larger than the 1 percent increase for May, led by sharp rises in energy prices. Food prices are 10.4 percent higher since last year. And all that’s before the massive increase in electricity prices you are about to see in August - Eversource and Liberty are doubling their energy supply rates, while the NHEC is increasing their power charge by over 75%, due to the current oil and gas price increases.
This means that the $100 banknote you got a year ago is only worth less than 92 of last year’s dollars today - the government used the other $8 to pay their bills by printing new money. Inflation acts as a hidden tax because people confuse nominal dollars with real dollars and don’t realize how much their actual purchasing power was reduced.
Inflation also acts as a hidden tax rate increase because the steady increase in income needed to just keep up with inflation is pushing us into higher tax brackets. The Alternative Minimum Tax (initially passed due because a few wealthy taxpayers paid no income tax) is a perfect example of that tax rate creep. It affected less than a million taxpayers when passed in 1979, increasing to 5 million taxpayers affected by 2004 because the income thresholds were not adjusted for inflation.The federal government’s spending and policies are largely responsible for the current high inflation. One major culprit was the $2 trillion partisan spending bill Biden and the Democrats adopted at the start of Biden's presidency, pumping huge amounts of money into the economy with the explicit goal of keeping the current economic bubble artificially inflated, despite warnings from even Democratic party economists that inflation will explode as a result.
In sharp contrast, New Hampshire’s economy is in excellent shape when compared with any other US state because the Republican majority in our legislature did a great job budgeting so the state government lives within its means, just like all of us have to. The Republicans also passed 5 decreases in employer taxes since 2015, a phaseout of the Interest and Dividends Tax, substantial reductions in regulations, eliminating the electricity consumption tax, property tax relief, etc. - that is why while other states are in a recession, our economy is still growing.
Going forward, we should continue to lower taxes, increase health care choice and competition to bring healthcare prices down, ease regulations on occupational licensure, encourage businesses and development, etc.
If elected, I will fight hard to lower our taxes by keeping government spending under control. I will firmly oppose any attempts to impose a sales or income tax, and will look for ways to increase our economic freedoms so that we all benefit from sustainable economic growth.
You are welcome to text or call me at (603) 267 4142 or email me at dpmwindham@gmail.com to help you decide if I deserve your support on September 13th.
Daniel Popovici-Muller
Republican Candidate for State Representative